"The trade and investment policy initiated by the Indian Government during 1991 economic reforms involved some major decision-making with respect to local industries." Elaborate any two major decisions and their respective impacts on the Indian economy. "British colonial rule in India resulted into systematic deindustrialisation of Indian indigenous industries." Explain the two-fold motive of the British with valid arguments.

Question

Accepted Answer

Two major decisions with respect to local industries under 1991 trade and investment policy:

1. **Removal of Quantitative Restrictions:** Quantitative restrictions on imports of manufactured consumer goods and agricultural products were fully removed from April 2001. This allowed local industries to face competition from international markets.

2. **Reduction in Import Duties:** Import duties were considerably reduced from peak rate of 250% to 10%. This improved competitiveness of domestic industries by enabling them to import raw materials at better prices.

3. **Removal of Export Duties:** Export duties were removed to increase competitive position of Indian goods in international markets.

4. **Relaxation in Import Licensing:** Import licensing was abolished except for hazardous and environmentally sensitive industries.